After seven years and three Democratic governors, New York is still the least business-friendly and the least economically free state in the nation.
For that dubious distinction, in part we can thank our state’s 83 volumes of regulations, which chase large businesses out of state and smother small businesses.
Gov. Andrew M. Cuomo may talk of “opening” New York for business, but our state remains the least economically attractive state in which to start or grow a business. The more burdensome the regulations, the more expensive it is to do business, and fewer workers are hired and more are fired. It’s death by a thousand cuts.
Thousands of archaic, unnecessary and costly regulations remain in place and hinder businesses and job creation. This status quo demands redress in the upcoming legislative session. Fortunately, State Sens. Patrick M. Gallivan and David J. Valesky have established a bipartisan commission to examine and identify for reform hundreds of counterproductive regulations.
It’s now incumbent upon Cuomo to put their proposals to work. Senate Republicans have already called upon the governor to identify at least 1,000 rules or regulations to repeal, with a focus on those deemed an impediment to economic growth and job creation. That might sound far-fetched, but it’s not. The state of Florida recently identified more than 3,000 regulations and rules as worthy of repeal or revision.
Small businesses, by far our biggest job creators, are the least equipped to deal with New York’s regulatory burdens, yet small business owners applying for a professional license or permit can be left waiting for months. In a state that heavily regulates commerce, a transparent and accountable government is a sine qua non for small businesses to grow and create jobs. Agencies must have transparent approval processes and time lines for permits or licenses, and deviations deserve explanations and refunds.
Egregious and singular examples, large and small, abound:
In 2010, Democrats in control of both houses of the legislature and the governorship imposed annual wage notifications that force New York’s businesses to use more than 50 million pages of paper every year.
New limited liability companies and partnerships are required to pay a $4,000 fee for announcements that go unread in law journals and other publications – a tribute to those publications’ political clout in Albany.
New York’s antiquated Scaffold Law makes employers and property owners absolutely liable for work site injuries, even if the injury was caused by the worker’s gross negligence. New York is the only state in the nation with such a law still on the books. The result is higher construction costs for public and private sector projects, fewer projects initiated and fewer jobs for workers.
Repealing this 19th century relic would encourage economic activity and put more New Yorkers back to work. But it’s just one of a trio of expensive laws, the other two being the Wicks Law, which arbitrarily forces local governments to hire separate contractors for different aspects of construction projects, and the Triborough Amendment, which guarantees negotiation-free salary increases for government workers.
It doesn’t bode well for New York’s small businesses that Cuomo declared these laws politically sacred and unchangeable in his end-of-the-year press conference.
It’s not enough to repeal regulations – we need to make sure that New York never descends into this regulatory hell again. New York needs a task force with extraordinary powers to review regulations and, subject to legislative override, repeal those determined to be over-burdensome and unnecessary. After completing its initial work, the commission would reconvene every 10 years to review regulations imposed over the previous decade.
Absent systemic regulatory reform, New York State will continue to bleed businesses and jobs. There exists a bipartisan Senate consensus with very specific recommendations for regulatory reform. Now it’s up to the governor to seize the moment, to show unexpected political courage and lead; otherwise all his taxpayer-funded ads about New York being “open for business” are exposed as rhetoric that does not match reality.
Ed Cox is chairman of the New York Republican State Committee.